Zimmer Holdings, Inc. and Biomet, Inc.; Analysis of Proposed Consent Order To Aid Public Comment, 37259-37263 [2015-16081]

Download as PDF asabaliauskas on DSK5VPTVN1PROD with NOTICES Federal Register / Vol. 80, No. 125 / Tuesday, June 30, 2015 / Notices Section 96.17(d) requires that FSS Earth Station licensees register annually with the SAS to receive interference protection. Section 96.21(a)(3) requires that existing commercial wireless broadband licensees operating in the band register in order to receive interference protection. Sections 96.23(b); 96.33(b); 96.39(a)(1) and (c)–(e); 96.43(b); 96.45(d) require that the Citizens Broadband Radio Services Devices (CBSDs), which will operate on the Citizens Broadband Radio Service, must be registered with an SAS before use, provide specified information to the SAS, and adhere to certain operating parameters. Section 96.35(e) requires that users operating Category B CBSDs must coordinate among each other and resolve interference through technological solutions or other agreements. Sections 96.39(a) and (b) require that CBSDs report their geographic coordinates to an SAS automatically through the device or by a professional installer. Sections 96.39(f) and (g) require that CBSDs incorporate sufficient security measures so that they are only able to communicate with the SAS and approved users and devices. Section 96.41(d)(1) requires that licensees must report the use of an alternative Received Signal Strength Limit (RSSL) to the SAS. Section 96.51 requires that manufacturers include a statement of compliance with the Commission’s Radio Frequency (RF) safety rules with equipment authorization applications. Sections 96.57(a)–(c); 96.59(a); 96.61 require that the SAS be capable of receiving registration and technical information from CBSDs, SASs, and ESCs, as well as employ secure communication protocols. Section 96.63 requires that SAS Administrator applicants must demonstrate to the Commission that they are qualified to manage an SAS. Section 96.67 requires that an Environmental Sensing Capability (ESC), used to protect federal radar systems from interference, may only operate after receiving Commission approval and be able to communicate information about the presence of a federal system and maintain security of the detected signals. These rules which contain information collection requirements are designed to provide for flexible use of this spectrum, while managing three tiers of users in the band, and create a low-cost entry point for a wide array of users. The rules will encourage VerDate Sep<11>2014 17:34 Jun 29, 2015 Jkt 235001 innovation and investment in mobile broadband use in this spectrum while protecting incumbent users. Without this information, the Commission would not be able to carry out its statutory responsibilities. Federal Communications Commission. Gloria J. Miles, Federal Register Liaison Officer, Office of the Secretary. [FR Doc. 2015–15999 Filed 6–29–15; 8:45 am] BILLING CODE 6712–01–P FEDERAL RESERVE SYSTEM Formations of, Acquisitions by, and Mergers of Bank Holding Companies The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) (BHC Act), Regulation Y (12 CFR part 225), and all other applicable statutes and regulations to become a bank holding company and/or to acquire the assets or the ownership of, control of, or the power to vote shares of a bank or bank holding company and all of the banks and nonbanking companies owned by the bank holding company, including the companies listed below. The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The applications will also be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States. Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than July 24, 2015. A. Federal Reserve Bank of St. Louis (Yvonne Sparks, Community Development Officer) P.O. Box 442, St. Louis, Missouri 63166–2034: 1. BankFirst Capital Corporation, Macon, Mississippi; to merge with Newton County Bancorporation, Inc., and thereby indirectly acquire Newton County Bank, both in Newton, Mississippi. PO 00000 Frm 00041 Fmt 4703 Sfmt 4703 37259 Board of Governors of the Federal Reserve System, June 25, 2015. Michael J. Lewandowski, Associate Secretary of the Board. [FR Doc. 2015–16015 Filed 6–29–15; 8:45 am] BILLING CODE 6210–01–P FEDERAL RESERVE SYSTEM Change in Bank Control Notices; Acquisitions of Shares of a Bank or Bank Holding Company The notificants listed below have applied under the Change in Bank Control Act (12 U.S.C. 1817(j)) and § 225.41 of the Board’s Regulation Y (12 CFR 225.41) to acquire shares of a bank or bank holding company. The factors that are considered in acting on the notices are set forth in paragraph 7 of the Act (12 U.S.C. 1817(j)(7)). The notices are available for immediate inspection at the Federal Reserve Bank indicated. The notices also will be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing to the Reserve Bank indicated for that notice or to the offices of the Board of Governors. Comments must be received not later than July 15, 2015. A. Federal Reserve Bank of San Francisco (Gerald C. Tsai, Director, Applications and Enforcement) 101 Market Street, San Francisco, California 94105–1579: 1. Irving Moore Feldkamp, III, The Irving M. Feldkamp and Pamela Jo Feldkamp Family Trust of 2003, both of Redlands, California, Irving M. Feldkamp, IV, Paragold, LP, both of San Bernardino, California, and Burlington National Indemnity, Ltd., Grand Cayman, Cayman Island; to acquire voting shares of Seacoast Commerce Banc Holdings, and thereby indirectly acquire voting shares of Seacoast Commerce Bank, both in San Diego, California. Board of Governors of the Federal Reserve System, June 25, 2015. Michael J. Lewandowski, Associate Secretary of the Board. [FR Doc. 2015–16016 Filed 6–29–15; 8:45 am] BILLING CODE 6210–01–P FEDERAL TRADE COMMISSION [File No. 141–0144] Zimmer Holdings, Inc. and Biomet, Inc.; Analysis of Proposed Consent Order To Aid Public Comment AGENCY: E:\FR\FM\30JNN1.SGM Federal Trade Commission. 30JNN1 37260 ACTION: Federal Register / Vol. 80, No. 125 / Tuesday, June 30, 2015 / Notices Proposed consent agreement. The consent agreement in this matter settles alleged violations of federal law prohibiting unfair methods of competition. The attached Analysis to Aid Public Comment describes both the allegations in the draft complaint and the terms of the consent order— embodied in the consent agreement— that would settle these allegations. DATES: Comments must be received on or before July 24, 2015. ADDRESSES: Interested parties may file a comment at https:// ftcpublic.commentworks.com/ftc/ zimmerbiometconsent online or on paper, by following the instructions in the Request for Comment part of the SUPPLEMENTARY INFORMATION section below. Write ‘‘Zimmer Holdings, Inc. and Biomet, Inc.—Consent Agreement; File No. 141–0144’’ on your comment and file your comment online at https://ftcpublic.commentworks.com/ ftc/zimmerbiometconsent by following the instructions on the web-based form. If you prefer to file your comment on paper, write ‘‘Zimmer Holdings, Inc. and Biomet, Inc.—Consent Agreement; File No. 141–0144’’ on your comment and on the envelope, and mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC–5610 (Annex D), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 20024. FOR FURTHER INFORMATION CONTACT: Christine Tasso, Bureau of Competition, (202–326–2232), 600 Pennsylvania Avenue NW., Washington, DC 20580. SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, notice is hereby given that the above-captioned consent agreement containing consent order to cease and desist, having been filed with and accepted, subject to final approval, by the Commission, has been placed on the public record for a period of thirty (30) days. The following Analysis to Aid Public Comment describes the terms of the consent agreement, and the allegations in the complaint. An electronic copy of the full text of the consent agreement package can be obtained from the FTC Home Page (for June 24, 2015), on the World Wide Web, at http://www.ftc.gov/ os/actions.shtm. You can file a comment online or on paper. For the Commission to consider asabaliauskas on DSK5VPTVN1PROD with NOTICES SUMMARY: VerDate Sep<11>2014 17:34 Jun 29, 2015 Jkt 235001 your comment, we must receive it on or before July 24, 2015. Write ‘‘Zimmer Holdings, Inc. and Biomet, Inc.— Consent Agreement; File No. 141–0144’’ on your comment. Your comment— including your name and your state— will be placed on the public record of this proceeding, including, to the extent practicable, on the public Commission Web site, at http://www.ftc.gov/os/ publiccomments.shtm. As a matter of discretion, the Commission tries to remove individuals’ home contact information from comments before placing them on the Commission Web site. Because your comment will be made public, you are solely responsible for making sure that your comment does not include any sensitive personal information, like anyone’s Social Security number, date of birth, driver’s license number or other state identification number or foreign country equivalent, passport number, financial account number, or credit or debit card number. You are also solely responsible for making sure that your comment does not include any sensitive health information, like medical records or other individually identifiable health information. In addition, do not include any ‘‘[t]rade secret or any commercial or financial information which . . . is privileged or confidential,’’ as discussed in Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). In particular, do not include competitively sensitive information such as costs, sales statistics, inventories, formulas, patterns, devices, manufacturing processes, or customer names. If you want the Commission to give your comment confidential treatment, you must file it in paper form, with a request for confidential treatment, and you have to follow the procedure explained in FTC Rule 4.9(c), 16 CFR 4.9(c).1 Your comment will be kept confidential only if the FTC General Counsel, in his or her sole discretion, grants your request in accordance with the law and the public interest. Postal mail addressed to the Commission is subject to delay due to heightened security screening. As a result, we encourage you to submit your comments online. To make sure that the Commission considers your online comment, you must file it at https:// ftcpublic.commentworks.com/ftc/ zimmerbiometconsent by following the 1 In particular, the written request for confidential treatment that accompanies the comment must include the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. See FTC Rule 4.9(c), 16 CFR 4.9(c). PO 00000 Frm 00042 Fmt 4703 Sfmt 4703 instructions on the web-based form. If this Notice appears at http:// www.regulations.gov/#!home, you also may file a comment through that Web site. If you file your comment on paper, write ‘‘Zimmer Holdings, Inc. and Biomet, Inc.—Consent Agreement; File No. 141–0144’’ on your comment and on the envelope, and mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC–5610 (Annex D), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 20024. If possible, submit your paper comment to the Commission by courier or overnight service. Visit the Commission Web site at http://www.ftc.gov to read this Notice and the news release describing it. The FTC Act and other laws that the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. The Commission will consider all timely and responsive public comments that it receives on or before July 24, 2015. For information on the Commission’s privacy policy, including routine uses permitted by the Privacy Act, see http://www.ftc.gov/ftc/ privacy.htm. Analysis of Agreement Containing Consent Order To Aid Public Comment Introduction The Federal Trade Commission (‘‘Commission’’) has accepted from Zimmer Holdings, Inc. (‘‘Zimmer’’), subject to final approval, an Agreement Containing Consent Order (‘‘Consent Agreement’’), which is designed to remedy the anticompetitive effects likely to result from Zimmer’s proposed acquisition of Biomet, Inc. (‘‘Biomet’’). Under the terms of the proposed Decision and Order (‘‘Order’’) contained in the Consent Agreement, Zimmer and Biomet must divest Zimmer’s Unicompartmental High Flex Knee System (‘‘ZUK’’) business in the United States to Smith & Nephew, Inc. (‘‘Smith & Nephew’’) and divest Biomet’s Discovery Elbow and Cobalt Bone Cement businesses in the United States to DJO Global, Inc. (‘‘DJO’’). The Consent Agreement has been placed on the public record for 30 days to solicit comments from interested persons. Comments received during this period will become part of the public record. After 30 days, the Commission E:\FR\FM\30JNN1.SGM 30JNN1 Federal Register / Vol. 80, No. 125 / Tuesday, June 30, 2015 / Notices will again review the Consent Agreement and the comments received, and decide whether it should withdraw from the Consent Agreement, modify it, or make it final. Pursuant to an agreement signed on April 24, 2014, Zimmer plans to acquire Biomet for approximately $13.35 billion (the ‘‘Proposed Acquisition’’). The Commission’s Complaint alleges that the Proposed Acquisition, if consummated, would violate Section 7 of the Clayton Act, as amended, 15 U.S.C. 18, and Section 5 of the Federal Trade Commission Act, as amended, 15 U.S.C. 45, by substantially lessening competition in the U.S. markets for: (1) Unicondylar knee implants; (2) total elbow implants; and (3) bone cement. The proposed Consent Agreement will remedy the alleged violations by preserving the competition that would otherwise be eliminated by the Proposed Acquisition. The Parties Zimmer, headquartered in Warsaw, Indiana, is the third-largest musculoskeletal medical device company in the United States and worldwide, specializing in the design, development, manufacture, and marketing of orthopedic reconstructive products. In 2013, Zimmer generated U.S. revenues of $2.42 billion. Biomet, also headquartered in Warsaw, Indiana, is the fourth-largest musculoskeletal medical device company in the United States and the fifth-largest globally. In 2013, Biomet generated U.S. revenues of $1.86 billion. The Relevant Products and Market Structures asabaliauskas on DSK5VPTVN1PROD with NOTICES Unicondylar Knee Implants Unicondylar knee implants are medical devices that replace damaged bone and cartilage in only one of the knee’s three condyles. The most common indication for a unicondylar knee implant is osteoarthritic damage in the medial condyle. In comparison to a total knee implant, which replaces all three condyles, a unicondylar knee implant requires less invasive surgery and allows a patient to have a more natural feeling knee upon recovery from surgery. Unicondylar knee implants vary in a number of ways; however, one of the most important differences among the implants is whether they have a fixed or mobile bearing. In a fixed bearing implant, a plastic piece is fixed permanently to the end of the tibia. In a mobile bearing knee, the plastic piece moves and glides over the tibia as the knee moves. The mobile bearing places VerDate Sep<11>2014 17:34 Jun 29, 2015 Jkt 235001 less stress on the bearing surface and may extend the longevity of the implant. Despite these differences, fixed bearing and mobile bearing implants are in the same product market because surgeons regularly substitute between them as they achieve comparable functional outcomes for the same indications. The market for unicondylar knee implants is highly concentrated. Biomet, which markets the Oxford implant, is the market leader, with a share of at least 44%. Biomet’s Oxford is the only mobile bearing knee implant currently on the market. Zimmer, the secondleading supplier of unicondylar knee implants, controls at least 23% of the market with its fixed bearing implant, ZUK. Stryker Corporation (‘‘Stryker’’) offers two unicondylar knee implants with fixed bearings: The Triathlon PKR and MAKOPlasty, a robotic-assisted surgery option. Stryker’s market share is approximately 8%. Johnson & Johnson, through its DePuySynthes Companies (‘‘J&J DePuy’’), and Smith & Nephew both offer fixed bearing knee implants and are distant fourth and fifth competitors, maintaining approximately 6% and 3% shares of the market, respectively. Additionally, a number of small, fringe competitors each control a small share of the market, but individually and collectively have limited competitive significance. Absent a remedy, the Proposed Acquisition would produce a single firm controlling at least 67% of the unicondylar knee implant market and substantially increase market concentration. Total Elbow Implants Total elbow implants are medical devices that replace damaged bone and cartilage in the elbow joint caused by osteoarthritis or a severe elbow fracture. Total elbow implants replace the elbow joint with a metal hinge that affixes to stems implanted into the humerus and the ulna. There are two types of total elbow implants: Linked and unlinked. Linked total elbow implants connect the humeral stem to the ulnar stem with a pin and locking device, providing extra stability where the ligaments surrounding the elbow joint are weak. Unlinked total elbow implants do not connect the humeral stem to the ulnar stem mechanically; instead, they use the patient’s natural ligaments to secure the implant. Linked and unlinked total elbow implants are viewed as reasonably interchangeable by health care providers because they treat the same indications and are priced similarly. The market for total elbow implants is highly concentrated today, and the Proposed Acquisition would increase PO 00000 Frm 00043 Fmt 4703 Sfmt 4703 37261 concentration in this market substantially. Zimmer and Biomet are the two largest suppliers of total elbow implants. Apart from the merging parties, Tornier, Inc. (‘‘Tornier’’) is the only other significant supplier of total elbow implants. Zimmer offers two products—the Coonrad/Morrey Total Elbow and the Nexel Total Elbow. The Coonrad/Morrey Total Elbow, developed at the Mayo Clinic, is a cemented, linked total elbow implant with twenty-four years of clinical history. In late 2013, Zimmer launched the Nexel Total Elbow, which updated the Coonrad/Morrey Total Elbow with, among other things, a revised linkage system and instrumentation, and an improved bearing surface. Biomet’s Discovery Total Elbow is also a cemented, linked implant supported by over ten years of clinical history. Tornier launched its Latitude EV implant, a cemented total elbow system capable of converting between a linked and unlinked prosthesis, in the United States in 2013. Bone Cement Surgeons use bone cement in a wide variety of joint arthroplasties to affix implants to bones, including the vast majority of knee and elbow implants, as well as many hip and shoulder procedures. Bone cement is available in high, medium, and low viscosities and in non-antibiotic and antibiotic formulations. Surgeons select bone cement based on its viscosity, whether it has an antibiotic component, supporting clinical data, and familiarity. Because surgeons generally use the more expensive antibiotic bone cement only for patients with a high risk of infection, it may be appropriate to analyze the Proposed Acquisition in separate relevant markets for antibiotic and non-antibiotic bone cement. Most customers, however, purchase both types of bone cement through a single contract with a single vendor, and the market participants, competitive dynamics, and entry barriers are the same for both antibiotic and nonantibiotic bone cement. Thus, for convenience and efficiency, it is appropriate to analyze the impact of the Proposed Acquisition in a relevant market for all bone cement products. Four primary suppliers serve the U.S. bone cement market: Stryker, Zimmer, J&J DePuy, and Biomet, which together account for approximately 98% of all bone cement sales in the United States. Stryker’s Simplex is the market leader, with a share of approximately 40% of the market. Zimmer, the second-largest bone cement supplier, has a market share of approximately 30%. Zimmer E:\FR\FM\30JNN1.SGM 30JNN1 37262 Federal Register / Vol. 80, No. 125 / Tuesday, June 30, 2015 / Notices derives nearly all of its bone cement revenues from the sale of Palacos, which Zimmer distributes under license from Heraeus Holding. J&J DePuy takes approximately 18% of the market with its SmartSet bone cement, while Biomet’s Cobalt has an approximate 10% market share. The Proposed Acquisition would reduce the number of major suppliers of bone cement in the United States from four to three and increase concentration in this market substantially. The Relevant Geographic Market The United States is the relevant geographic market in which to analyze the effects of the Proposed Acquisition. Medical devices sold outside of the United States are not viable alternatives for U.S. consumers, as they cannot turn to these products even in the event of a price increase for products currently available in the United States. Further, the U.S. Food and Drug Administration (‘‘FDA’’) must approve any medical device before it is sold in the United States, a process that generally takes a significant amount of time. Thus, suppliers of medical devices outside the United States cannot shift their product into the U.S. market quickly enough to be considered current market participants. asabaliauskas on DSK5VPTVN1PROD with NOTICES Entry Entry or expansion into the markets for unicondylar knee implants, total elbow implants, and bone cement would not be timely, likely, or sufficient to counteract the likely anticompetitive effects of the Proposed Acquisition. To enter or effectively expand in any of these markets successfully, a supplier would need to design and manufacture an effective product, obtain FDA approval, and develop clinical history supporting the long-term efficacy of its product. The new entrant or putative expanding firm also would need to develop and foster product loyalty and establish a nationwide sales network capable of marketing the product and providing on-site service at hospitals throughout the country. Such development efforts are difficult, timeconsuming, and expensive, and often fail to result in a competitive product reaching the market. Effects of the Acquisition Zimmer’s acquisition of Biomet would likely result in substantial anticompetitive effects in the unicondylar knee implant market by eliminating substantial head-to-head competition between the two most successful implants. Zimmer’s ZUK and Biomet’s Oxford are particularly close VerDate Sep<11>2014 17:34 Jun 29, 2015 Jkt 235001 competitors because of their welldocumented clinical success records. As close competitors, customers currently leverage the Oxford and ZUK against each other to obtain better pricing. Additionally, Zimmer and Biomet continually improve features of their unicondylar knee implants in order to win business from physicians. Therefore, absent a remedy, the Proposed Acquisition would likely result in unilateral price effects and reduced innovation. The Proposed Acquisition would also eliminate substantial competition between Zimmer and Biomet in the market for total elbow implants. Market participants indicate that Zimmer and Biomet total elbow implants are each other’s next best alternative based upon design similarities and comparable clinical outcomes. As close substitutes, Zimmer and Biomet currently compete directly, including on price and service. Zimmer’s Palacos and Biomet’s Cobalt Bone Cement products are particularly close substitutes that currently compete aggressively against each other. Absent a remedy, the Proposed Acquisition would result in the loss of substantial price competition between Zimmer and Biomet for the sales of their products. The Consent Agreement The Consent Agreement eliminates the competitive concerns raised by the Proposed Acquisition by requiring Zimmer and Biomet to divest all U.S. assets and rights related to Zimmer’s ZUK unicondylar knee implant to Smith & Nephew and all U.S. assets and rights related to Biomet’s Discovery Total Elbow implant and Cobalt Bone Cement to DJO. This divestiture will preserve the competition that currently exists in each of the relevant markets. Smith & Nephew is a global specialty pharmaceutical company headquartered in London, United Kingdom. Smith & Nephew employs more than 14,000 employees worldwide with approximately 6,225 employees in the United States. In 2014, Smith & Nephew generated worldwide revenues of approximately $5.8 billion, of which approximately $1.5 billion came from its orthopedic reconstruction business. DJO develops, manufactures, and distributes a wide range of medical devices, including orthopedic implants. Headquartered in Vista, California, DJO employs 5,200 people, and had revenues of approximately $1.2 billion in 2014. DJO’s orthopedic implant business had approximately $100 million in 2014 revenues. Pursuant to the Order, Smith & Nephew will receive all U.S. assets and rights related to the ZUK unicondylar PO 00000 Frm 00044 Fmt 4703 Sfmt 4703 knee product, including intellectual property, manufacturing technology, and existing inventory. Zimmer is also required to waive any non-compete employment clauses and assist in facilitating employment interviews between key employees and sales representatives from Zimmer distributors who currently sell the ZUK. The Order further requires Zimmer to provide transitional services to Smith & Nephew to assist them in establishing their manufacturing capabilities and securing all necessary FDA approvals. The Order requires Biomet to divest all U.S. assets and rights necessary to enable DJO to become an independently viable and effective competitor in the total elbow implant and bone cement markets. Biomet is required to divest to DJO all of its U.S. assets and rights to research, develop, manufacture, market, and sell its total elbow implant and bone cement products, including all related intellectual property, manufacturing technology, and existing inventory. Biomet will also divest all U.S. assets and rights to its bone cement accessories, which consist of mixing and delivery systems that allow surgeons to control the bone cement ingredients to ensure a complete and consistent bone cement mixture and to apply cement onto an implant accurately. Hospitals and group purchasing organizations frequently purchase bone cement and bone cement accessories together. Further, the Order facilitates DJO’s hiring of the Biomet sales representatives and employees whose responsibilities are related to bone cement and total elbow implants. The Order requires Zimmer and Biomet to divest their respective U.S. assets and rights to the divested products no later than ten days after the Proposed Acquisition is consummated or on the date the Order becomes final, whichever is earlier. If the Commission determines that Smith & Nephew or DJO is not an acceptable acquirer, or that the manner of the divestiture is not acceptable, the Order requires Zimmer and Biomet to unwind the sale and divest the products within six months of the date the Order becomes final to another Commission-approved acquirer or acquirers. In that circumstance, the Commission may appoint a trustee to accomplish the divestiture if the parties fail to divest the products. The Commission has agreed to appoint an interim monitor to ensure that Zimmer and Biomet comply with all of their obligations pursuant to the Consent Agreement and to keep the Commission informed about the status of the transfer of the assets and rights to Smith & Nephew and DJO. E:\FR\FM\30JNN1.SGM 30JNN1 Federal Register / Vol. 80, No. 125 / Tuesday, June 30, 2015 / Notices The purpose of this analysis is to facilitate public comment on the proposed Consent Agreement, and it is not intended to constitute an official interpretation of the proposed Order or to modify its terms in any way. By direction of the Commission. Donald S. Clark, Secretary. [FR Doc. 2015–16081 Filed 6–29–15; 8:45 am] BILLING CODE 6750–01–P GENERAL SERVICES ADMINISTRATION [Notice–CECANF–2015–06; Docket No. 2015–0006; Sequence No. 6] Commission To Eliminate Child Abuse and Neglect Fatalities; Cancellation of Meeting Commission to Eliminate Child Abuse and Neglect Fatalities, General Services Administration. AGENCY: ACTION: Meeting Cancellation. The Commission to Eliminate Child Abuse and Neglect Fatalities (CECANF), a Federal Advisory Committee established by the Protect Our Kids Act of 2012, published a Federal Register notice at 80 FR 36340, on June 24, 2015, announcing a meeting on July 1, 2015. The meeting has been cancelled. SUMMARY: DATES: Effective: June 24, 2015. Visit the CECANF Web site at https:// eliminatechildabusefatalities. sites.usa.gov/ or contact Patricia Brincefield, Communications Director, at 202–818–9596, U.S. General Services Administration, 1800 F Street NW., Room 7003D, Washington DC 20405, Attention: Tom Hodnett (CD) for CECANF. FOR FURTHER INFORMATION CONTACT: The Commission to Eliminate Child Abuse and Neglect Fatalities (CECANF) published a Federal Register notice at 80 FR 36340, on June 24, 2015, announcing a public meeting on July 1, 2015 in Washington, DC. The meeting has been cancelled due to a lack of availability of invitees. At this time, there are no plans to reschedule the event. asabaliauskas on DSK5VPTVN1PROD with NOTICES SUPPLEMENTARY INFORMATION: Dated: June 24, 2015. Amy Templeman, Acting Executive Director. [FR Doc. 2015–16040 Filed 6–29–15; 8:45 am] BILLING CODE 6820–34–P VerDate Sep<11>2014 17:34 Jun 29, 2015 Jkt 235001 DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Disease Control and Prevention Advisory Board on Radiation and Worker Health (ABRWH or Advisory Board), National Institute for Occupational Safety and Health (NIOSH) In accordance with section 10(a)(2) of the Federal Advisory Committee Act (Pub. L. 92–463), and pursuant to the requirements of 42 CFR 83.15(a), the Centers for Disease Control and Prevention (CDC), announces the following meeting of the aforementioned committee: Times and Dates (All times are Mountain Time): 8:15 a.m.–5:30 p.m., Mountain Time, July 23, 2015 8:15 a.m.–12:00 p.m., Mountain Time, July 24, 2015 Public Comment Times and Dates (All times are Mountain Time): 5:30 p.m.–6:30 p.m.,* Mountain Time, July 23, 2015 *Please note that the public comment period may end before the time indicated, following the last call for comments. Members of the public who wish to provide public comments should plan to attend the public comment session at the start time listed. Place: Residence Inn by Marriott, 635 West Broadway, Idaho Falls, Idaho 83402, Phone: 208–542–0000; Fax: 208– 542–0021. Audio Conference Call via FTS Conferencing. The USA toll-free, dial-in number is 1–866–659–0537 with a pass code of 9933701. Live Meeting CONNECTION: https:// www.livemeeting.com/cc/cdc/join?id 9RTB4M&role=attend&pw=ABRWH; Meeting ID: 9RTB4M; Entry Code: ABRWH. Status: Open to the public, limited only by the space available. The meeting space accommodates approximately 100 people. Background: The Advisory Board was established under the Energy Employees Occupational Illness Compensation Program Act of 2000 to advise the President on a variety of policy and technical functions required to implement and effectively manage the new compensation program. Key functions of the Advisory Board include providing advice on the development of probability of causation guidelines which have been promulgated by the Department of Health and Human Services (HHS) as a final rule, advice on methods of dose reconstruction which have also been promulgated by HHS as PO 00000 Frm 00045 Fmt 4703 Sfmt 4703 37263 a final rule, advice on the scientific validity and quality of dose estimation and reconstruction efforts being performed for purposes of the compensation program, and advice on petitions to add classes of workers to the Special Exposure Cohort (SEC). In December 2000, the President delegated responsibility for funding, staffing, and operating the Advisory Board to HHS, which subsequently delegated this authority to the CDC. NIOSH implements this responsibility for CDC. The charter was issued on August 3, 2001, renewed at appropriate intervals, and will expire on August 3, 2015. Purpose: This Advisory Board is charged with (a) providing advice to the Secretary, HHS, on the development of guidelines under Executive Order 13179; (b) providing advice to the Secretary, HHS, on the scientific validity and quality of dose reconstruction efforts performed for this program; and (c) upon request by the Secretary, HHS, advising the Secretary on whether there is a class of employees at any Department of Energy facility who were exposed to radiation but for whom it is not feasible to estimate their radiation dose, and on whether there is reasonable likelihood that such radiation doses may have endangered the health of members of this class. Matters for Discussion: The agenda for the Advisory Board meeting includes: NIOSH Program Update; Department of Labor Program Update; Department of Energy Program Update; SEC Issues Work Group Report on ‘‘Sufficient Accuracy/Co-Worker Dose Modeling’’; Report by the Dose Reconstruction Review Methods Work Group; SEC Petitions Update; SEC petitions for: Carborundum Company (1943–1976; Niagara Falls, New York), Rocky Flats Plant (1984–1989; Golden, Colorado), Idaho National Laboratory (1949–1970; Scoville, Idaho), and Kansas City Plant (1949–1993; Kansas City, Missouri); and Board Work Sessions. The agenda is subject to change as priorities dictate. In the event an individual cannot attend, written comments may be submitted to the contact person below well in advance of the meeting. Any written comments received will be provided at the meeting in accordance with the redaction policy provided below. Policy on Redaction of Board Meeting Transcripts (Public Comment): (1) If a person making a comment gives his or her personal information, no attempt will be made to redact the name; however, NIOSH will redact other personally identifiable information, E:\FR\FM\30JNN1.SGM 30JNN1

Agencies

[Federal Register Volume 80, Number 125 (Tuesday, June 30, 2015)]
[Notices]
[Pages 37259-37263]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-16081]


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FEDERAL TRADE COMMISSION

[File No. 141-0144]


Zimmer Holdings, Inc. and Biomet, Inc.; Analysis of Proposed 
Consent Order To Aid Public Comment

AGENCY: Federal Trade Commission.

[[Page 37260]]


ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair methods of competition. 
The attached Analysis to Aid Public Comment describes both the 
allegations in the draft complaint and the terms of the consent order-- 
embodied in the consent agreement--that would settle these allegations.

DATES: Comments must be received on or before July 24, 2015.

ADDRESSES: Interested parties may file a comment at https://ftcpublic.commentworks.com/ftc/zimmerbiometconsent online or on paper, 
by following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``Zimmer Holdings, Inc. 
and Biomet, Inc.--Consent Agreement; File No. 141-0144'' on your 
comment and file your comment online at https://ftcpublic.commentworks.com/ftc/zimmerbiometconsent by following the 
instructions on the web-based form. If you prefer to file your comment 
on paper, write ``Zimmer Holdings, Inc. and Biomet, Inc.--Consent 
Agreement; File No. 141-0144'' on your comment and on the envelope, and 
mail your comment to the following address: Federal Trade Commission, 
Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 
(Annex D), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Christine Tasso, Bureau of 
Competition, (202-326-2232), 600 Pennsylvania Avenue NW., Washington, 
DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned consent agreement 
containing consent order to cease and desist, having been filed with 
and accepted, subject to final approval, by the Commission, has been 
placed on the public record for a period of thirty (30) days. The 
following Analysis to Aid Public Comment describes the terms of the 
consent agreement, and the allegations in the complaint. An electronic 
copy of the full text of the consent agreement package can be obtained 
from the FTC Home Page (for June 24, 2015), on the World Wide Web, at 
http://www.ftc.gov/os/actions.shtm.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before July 24, 2015. 
Write ``Zimmer Holdings, Inc. and Biomet, Inc.--Consent Agreement; File 
No. 141-0144'' on your comment. Your comment--including your name and 
your state--will be placed on the public record of this proceeding, 
including, to the extent practicable, on the public Commission Web 
site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of 
discretion, the Commission tries to remove individuals' home contact 
information from comments before placing them on the Commission Web 
site.
    Because your comment will be made public, you are solely 
responsible for making sure that your comment does not include any 
sensitive personal information, like anyone's Social Security number, 
date of birth, driver's license number or other state identification 
number or foreign country equivalent, passport number, financial 
account number, or credit or debit card number. You are also solely 
responsible for making sure that your comment does not include any 
sensitive health information, like medical records or other 
individually identifiable health information. In addition, do not 
include any ``[t]rade secret or any commercial or financial information 
which . . . is privileged or confidential,'' as discussed in Section 
6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 
4.10(a)(2). In particular, do not include competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    If you want the Commission to give your comment confidential 
treatment, you must file it in paper form, with a request for 
confidential treatment, and you have to follow the procedure explained 
in FTC Rule 4.9(c), 16 CFR 4.9(c).\1\ Your comment will be kept 
confidential only if the FTC General Counsel, in his or her sole 
discretion, grants your request in accordance with the law and the 
public interest.
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    \1\ In particular, the written request for confidential 
treatment that accompanies the comment must include the factual and 
legal basis for the request, and must identify the specific portions 
of the comment to be withheld from the public record. See FTC Rule 
4.9(c), 16 CFR 4.9(c).
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    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/zimmerbiometconsent by following the instructions on the web-based 
form. If this Notice appears at http://www.regulations.gov/#!home, you 
also may file a comment through that Web site.
    If you file your comment on paper, write ``Zimmer Holdings, Inc. 
and Biomet, Inc.--Consent Agreement; File No. 141-0144'' on your 
comment and on the envelope, and mail your comment to the following 
address: Federal Trade Commission, Office of the Secretary, 600 
Pennsylvania Avenue NW., Suite CC-5610 (Annex D), Washington, DC 20580, 
or deliver your comment to the following address: Federal Trade 
Commission, Office of the Secretary, Constitution Center, 400 7th 
Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 20024. If 
possible, submit your paper comment to the Commission by courier or 
overnight service.
    Visit the Commission Web site at http://www.ftc.gov to read this 
Notice and the news release describing it. The FTC Act and other laws 
that the Commission administers permit the collection of public 
comments to consider and use in this proceeding as appropriate. The 
Commission will consider all timely and responsive public comments that 
it receives on or before July 24, 2015. For information on the 
Commission's privacy policy, including routine uses permitted by the 
Privacy Act, see http://www.ftc.gov/ftc/privacy.htm.

Analysis of Agreement Containing Consent Order To Aid Public Comment

Introduction

    The Federal Trade Commission (``Commission'') has accepted from 
Zimmer Holdings, Inc. (``Zimmer''), subject to final approval, an 
Agreement Containing Consent Order (``Consent Agreement''), which is 
designed to remedy the anticompetitive effects likely to result from 
Zimmer's proposed acquisition of Biomet, Inc. (``Biomet''). Under the 
terms of the proposed Decision and Order (``Order'') contained in the 
Consent Agreement, Zimmer and Biomet must divest Zimmer's 
Unicompartmental High Flex Knee System (``ZUK'') business in the United 
States to Smith & Nephew, Inc. (``Smith & Nephew'') and divest Biomet's 
Discovery Elbow and Cobalt Bone Cement businesses in the United States 
to DJO Global, Inc. (``DJO'').
    The Consent Agreement has been placed on the public record for 30 
days to solicit comments from interested persons. Comments received 
during this period will become part of the public record. After 30 
days, the Commission

[[Page 37261]]

will again review the Consent Agreement and the comments received, and 
decide whether it should withdraw from the Consent Agreement, modify 
it, or make it final.
    Pursuant to an agreement signed on April 24, 2014, Zimmer plans to 
acquire Biomet for approximately $13.35 billion (the ``Proposed 
Acquisition''). The Commission's Complaint alleges that the Proposed 
Acquisition, if consummated, would violate Section 7 of the Clayton 
Act, as amended, 15 U.S.C. 18, and Section 5 of the Federal Trade 
Commission Act, as amended, 15 U.S.C. 45, by substantially lessening 
competition in the U.S. markets for: (1) Unicondylar knee implants; (2) 
total elbow implants; and (3) bone cement. The proposed Consent 
Agreement will remedy the alleged violations by preserving the 
competition that would otherwise be eliminated by the Proposed 
Acquisition.

The Parties

    Zimmer, headquartered in Warsaw, Indiana, is the third-largest 
musculoskeletal medical device company in the United States and 
worldwide, specializing in the design, development, manufacture, and 
marketing of orthopedic reconstructive products. In 2013, Zimmer 
generated U.S. revenues of $2.42 billion.
    Biomet, also headquartered in Warsaw, Indiana, is the fourth-
largest musculoskeletal medical device company in the United States and 
the fifth-largest globally. In 2013, Biomet generated U.S. revenues of 
$1.86 billion.

The Relevant Products and Market Structures

Unicondylar Knee Implants

    Unicondylar knee implants are medical devices that replace damaged 
bone and cartilage in only one of the knee's three condyles. The most 
common indication for a unicondylar knee implant is osteoarthritic 
damage in the medial condyle. In comparison to a total knee implant, 
which replaces all three condyles, a unicondylar knee implant requires 
less invasive surgery and allows a patient to have a more natural 
feeling knee upon recovery from surgery.
    Unicondylar knee implants vary in a number of ways; however, one of 
the most important differences among the implants is whether they have 
a fixed or mobile bearing. In a fixed bearing implant, a plastic piece 
is fixed permanently to the end of the tibia. In a mobile bearing knee, 
the plastic piece moves and glides over the tibia as the knee moves. 
The mobile bearing places less stress on the bearing surface and may 
extend the longevity of the implant. Despite these differences, fixed 
bearing and mobile bearing implants are in the same product market 
because surgeons regularly substitute between them as they achieve 
comparable functional outcomes for the same indications.
    The market for unicondylar knee implants is highly concentrated. 
Biomet, which markets the Oxford implant, is the market leader, with a 
share of at least 44%. Biomet's Oxford is the only mobile bearing knee 
implant currently on the market. Zimmer, the second-leading supplier of 
unicondylar knee implants, controls at least 23% of the market with its 
fixed bearing implant, ZUK. Stryker Corporation (``Stryker'') offers 
two unicondylar knee implants with fixed bearings: The Triathlon PKR 
and MAKOPlasty, a robotic-assisted surgery option. Stryker's market 
share is approximately 8%. Johnson & Johnson, through its DePuySynthes 
Companies (``J&J DePuy''), and Smith & Nephew both offer fixed bearing 
knee implants and are distant fourth and fifth competitors, maintaining 
approximately 6% and 3% shares of the market, respectively. 
Additionally, a number of small, fringe competitors each control a 
small share of the market, but individually and collectively have 
limited competitive significance. Absent a remedy, the Proposed 
Acquisition would produce a single firm controlling at least 67% of the 
unicondylar knee implant market and substantially increase market 
concentration.

Total Elbow Implants

    Total elbow implants are medical devices that replace damaged bone 
and cartilage in the elbow joint caused by osteoarthritis or a severe 
elbow fracture. Total elbow implants replace the elbow joint with a 
metal hinge that affixes to stems implanted into the humerus and the 
ulna. There are two types of total elbow implants: Linked and unlinked. 
Linked total elbow implants connect the humeral stem to the ulnar stem 
with a pin and locking device, providing extra stability where the 
ligaments surrounding the elbow joint are weak. Unlinked total elbow 
implants do not connect the humeral stem to the ulnar stem 
mechanically; instead, they use the patient's natural ligaments to 
secure the implant. Linked and unlinked total elbow implants are viewed 
as reasonably interchangeable by health care providers because they 
treat the same indications and are priced similarly.
    The market for total elbow implants is highly concentrated today, 
and the Proposed Acquisition would increase concentration in this 
market substantially. Zimmer and Biomet are the two largest suppliers 
of total elbow implants. Apart from the merging parties, Tornier, Inc. 
(``Tornier'') is the only other significant supplier of total elbow 
implants. Zimmer offers two products--the Coonrad/Morrey Total Elbow 
and the Nexel Total Elbow. The Coonrad/Morrey Total Elbow, developed at 
the Mayo Clinic, is a cemented, linked total elbow implant with twenty-
four years of clinical history. In late 2013, Zimmer launched the Nexel 
Total Elbow, which updated the Coonrad/Morrey Total Elbow with, among 
other things, a revised linkage system and instrumentation, and an 
improved bearing surface. Biomet's Discovery Total Elbow is also a 
cemented, linked implant supported by over ten years of clinical 
history. Tornier launched its Latitude EV implant, a cemented total 
elbow system capable of converting between a linked and unlinked 
prosthesis, in the United States in 2013.

Bone Cement

    Surgeons use bone cement in a wide variety of joint arthroplasties 
to affix implants to bones, including the vast majority of knee and 
elbow implants, as well as many hip and shoulder procedures. Bone 
cement is available in high, medium, and low viscosities and in non-
antibiotic and antibiotic formulations. Surgeons select bone cement 
based on its viscosity, whether it has an antibiotic component, 
supporting clinical data, and familiarity. Because surgeons generally 
use the more expensive antibiotic bone cement only for patients with a 
high risk of infection, it may be appropriate to analyze the Proposed 
Acquisition in separate relevant markets for antibiotic and non-
antibiotic bone cement. Most customers, however, purchase both types of 
bone cement through a single contract with a single vendor, and the 
market participants, competitive dynamics, and entry barriers are the 
same for both antibiotic and non-antibiotic bone cement. Thus, for 
convenience and efficiency, it is appropriate to analyze the impact of 
the Proposed Acquisition in a relevant market for all bone cement 
products.
    Four primary suppliers serve the U.S. bone cement market: Stryker, 
Zimmer, J&J DePuy, and Biomet, which together account for approximately 
98% of all bone cement sales in the United States. Stryker's Simplex is 
the market leader, with a share of approximately 40% of the market. 
Zimmer, the second-largest bone cement supplier, has a market share of 
approximately 30%. Zimmer

[[Page 37262]]

derives nearly all of its bone cement revenues from the sale of 
Palacos, which Zimmer distributes under license from Heraeus Holding. 
J&J DePuy takes approximately 18% of the market with its SmartSet bone 
cement, while Biomet's Cobalt has an approximate 10% market share. The 
Proposed Acquisition would reduce the number of major suppliers of bone 
cement in the United States from four to three and increase 
concentration in this market substantially.

The Relevant Geographic Market

    The United States is the relevant geographic market in which to 
analyze the effects of the Proposed Acquisition. Medical devices sold 
outside of the United States are not viable alternatives for U.S. 
consumers, as they cannot turn to these products even in the event of a 
price increase for products currently available in the United States. 
Further, the U.S. Food and Drug Administration (``FDA'') must approve 
any medical device before it is sold in the United States, a process 
that generally takes a significant amount of time. Thus, suppliers of 
medical devices outside the United States cannot shift their product 
into the U.S. market quickly enough to be considered current market 
participants.

Entry

    Entry or expansion into the markets for unicondylar knee implants, 
total elbow implants, and bone cement would not be timely, likely, or 
sufficient to counteract the likely anticompetitive effects of the 
Proposed Acquisition. To enter or effectively expand in any of these 
markets successfully, a supplier would need to design and manufacture 
an effective product, obtain FDA approval, and develop clinical history 
supporting the long-term efficacy of its product. The new entrant or 
putative expanding firm also would need to develop and foster product 
loyalty and establish a nationwide sales network capable of marketing 
the product and providing on-site service at hospitals throughout the 
country. Such development efforts are difficult, time-consuming, and 
expensive, and often fail to result in a competitive product reaching 
the market.

Effects of the Acquisition

    Zimmer's acquisition of Biomet would likely result in substantial 
anticompetitive effects in the unicondylar knee implant market by 
eliminating substantial head-to-head competition between the two most 
successful implants. Zimmer's ZUK and Biomet's Oxford are particularly 
close competitors because of their well-documented clinical success 
records. As close competitors, customers currently leverage the Oxford 
and ZUK against each other to obtain better pricing. Additionally, 
Zimmer and Biomet continually improve features of their unicondylar 
knee implants in order to win business from physicians. Therefore, 
absent a remedy, the Proposed Acquisition would likely result in 
unilateral price effects and reduced innovation.
    The Proposed Acquisition would also eliminate substantial 
competition between Zimmer and Biomet in the market for total elbow 
implants. Market participants indicate that Zimmer and Biomet total 
elbow implants are each other's next best alternative based upon design 
similarities and comparable clinical outcomes. As close substitutes, 
Zimmer and Biomet currently compete directly, including on price and 
service.
    Zimmer's Palacos and Biomet's Cobalt Bone Cement products are 
particularly close substitutes that currently compete aggressively 
against each other. Absent a remedy, the Proposed Acquisition would 
result in the loss of substantial price competition between Zimmer and 
Biomet for the sales of their products.

The Consent Agreement

    The Consent Agreement eliminates the competitive concerns raised by 
the Proposed Acquisition by requiring Zimmer and Biomet to divest all 
U.S. assets and rights related to Zimmer's ZUK unicondylar knee implant 
to Smith & Nephew and all U.S. assets and rights related to Biomet's 
Discovery Total Elbow implant and Cobalt Bone Cement to DJO. This 
divestiture will preserve the competition that currently exists in each 
of the relevant markets.
    Smith & Nephew is a global specialty pharmaceutical company 
headquartered in London, United Kingdom. Smith & Nephew employs more 
than 14,000 employees worldwide with approximately 6,225 employees in 
the United States. In 2014, Smith & Nephew generated worldwide revenues 
of approximately $5.8 billion, of which approximately $1.5 billion came 
from its orthopedic reconstruction business.
    DJO develops, manufactures, and distributes a wide range of medical 
devices, including orthopedic implants. Headquartered in Vista, 
California, DJO employs 5,200 people, and had revenues of approximately 
$1.2 billion in 2014. DJO's orthopedic implant business had 
approximately $100 million in 2014 revenues.
    Pursuant to the Order, Smith & Nephew will receive all U.S. assets 
and rights related to the ZUK unicondylar knee product, including 
intellectual property, manufacturing technology, and existing 
inventory. Zimmer is also required to waive any non-compete employment 
clauses and assist in facilitating employment interviews between key 
employees and sales representatives from Zimmer distributors who 
currently sell the ZUK. The Order further requires Zimmer to provide 
transitional services to Smith & Nephew to assist them in establishing 
their manufacturing capabilities and securing all necessary FDA 
approvals.
    The Order requires Biomet to divest all U.S. assets and rights 
necessary to enable DJO to become an independently viable and effective 
competitor in the total elbow implant and bone cement markets. Biomet 
is required to divest to DJO all of its U.S. assets and rights to 
research, develop, manufacture, market, and sell its total elbow 
implant and bone cement products, including all related intellectual 
property, manufacturing technology, and existing inventory. Biomet will 
also divest all U.S. assets and rights to its bone cement accessories, 
which consist of mixing and delivery systems that allow surgeons to 
control the bone cement ingredients to ensure a complete and consistent 
bone cement mixture and to apply cement onto an implant accurately. 
Hospitals and group purchasing organizations frequently purchase bone 
cement and bone cement accessories together. Further, the Order 
facilitates DJO's hiring of the Biomet sales representatives and 
employees whose responsibilities are related to bone cement and total 
elbow implants.
    The Order requires Zimmer and Biomet to divest their respective 
U.S. assets and rights to the divested products no later than ten days 
after the Proposed Acquisition is consummated or on the date the Order 
becomes final, whichever is earlier. If the Commission determines that 
Smith & Nephew or DJO is not an acceptable acquirer, or that the manner 
of the divestiture is not acceptable, the Order requires Zimmer and 
Biomet to unwind the sale and divest the products within six months of 
the date the Order becomes final to another Commission-approved 
acquirer or acquirers. In that circumstance, the Commission may appoint 
a trustee to accomplish the divestiture if the parties fail to divest 
the products.
    The Commission has agreed to appoint an interim monitor to ensure 
that Zimmer and Biomet comply with all of their obligations pursuant to 
the Consent Agreement and to keep the Commission informed about the 
status of the transfer of the assets and rights to Smith & Nephew and 
DJO.

[[Page 37263]]

    The purpose of this analysis is to facilitate public comment on the 
proposed Consent Agreement, and it is not intended to constitute an 
official interpretation of the proposed Order or to modify its terms in 
any way.

By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2015-16081 Filed 6-29-15; 8:45 am]
 BILLING CODE 6750-01-P